In this series, we ask investors from all walks of life to chat about what it was like to make their first ever investment. Today, we talked to Caroline Ash. Caroline is 23, and works in the Risk Assurance team at a major professional services firm.
Caroline’s father was a Kiwi diplomat, so she spent her childhood travelling all over the world. She’s lived all over Europe, the Pacific and Asia. This experience gave her a very broad view of investing. As a result, she’s not a big fan of New Zealanders’ habit of investing solely in property, and she is a big fan of investing in a range of things that reflect your individual values.
While Caroline works at a Big Four professional services firm, her degree is actually in English Literature and International Relations. She doesn’t let this stop her—she didn’t need a commerce background to work in her job, and she doesn’t need one to be an investor either!
Why did you start investing?
Growing up overseas, Caroline saw that people don’t put their entire portfolio in one or two houses like they do in Aotearoa. She was keen to apply this in practice, but also, she can’t afford a deposit for a house at the moment! So she needed something different.
Caroline uses KiwiSaver, which she can access when she buys a house or turns 65. She wanted to add something with a bit more flexibility on top of that, so she can take bigger risks, and also cash in her returns in the next 5–10 years if she wants.
With this in mind, once she started her first grad job, she started looking for places to invest some spare money. She has an aggressive risk appetite, and is keen on bigger returns than a bank account could give her.
Can you tell us about your first investment?
Caroline initially looked at buying shares in companies like Apple, Tesla and Cisco, but the minimum investment amount and the management fees were too expensive. She said she’d probably be spending half her money on transaction fees and management fees!
She also looked into cryptocurrencies, as she’s a big fan of blockchain technology. However, that was too risky, even for her.
She eventually ended up signing up for Sharesies, and investing small amounts into a variety of funds that lined up with her investment goals. This was the easiest way for her to invest small amounts in a range of shares.
What kind of things do you invest in now?
Caroline is widely diversified through Sharesies, with her money sitting in multiple funds. Two funds she is particularly keen on are the Pathfinder funds—Global Responsibility and Global Water.
These funds let her invest in companies that reflect her values. She doesn’t want to invest in things that contribute to war or climate change, but she also wants to be globally diversified, as she saw benefits of a global society in her international-flavoured childhood.
The Global Responsibility fund gives her chunks of companies that not only avoid things like weapons and tobacco manufacturing, but also have high environmental, social and governance (ESG) scores. Global Water invests in water-related companies—things like water treatment, pipe manufacturing and specialist engineering. Caroline believes that socially and environmentally conscious businesses and funds are fundamental for future proofing our society, which she can contribute to while being smart with her money.
These funds, plus her other funds, give her a piece of all kinds of European, American, Australian and New Zealand companies. This lets her chase higher returns all around the world.
What is your advice for someone who is just getting into investing?
Caroline has a few suggestions:
- Set up a small automatic payment that coincides with your payday. You don’t miss your KiwiSaver contributions, and you won’t miss your investment either.
- Do your research—you don’t need loads of financial literacy to do this. Do some Googling, figure out how much risk you’re willing to take on, then choose investments that match that risk level. Find investments that match your values, too.
- Get started today!
She also recommends reading the Sharesies blog for lots of good tips. We couldn’t agree more—you can get started with this post about how to choose an investment.